BG India enters east coast deepwater blocks

New Delhi, Feb 19 (UNI) BG India today said it has signed two farm-in agreements with ONGC to acquire a participating interest in two deepwater blocks off the country's east coast.

''Under the terms of the agreements, BG will acquire a 30 per cent participating interest in KG-DWN-98/4 block and 25 per cent participating interest in MN-DWN-2002/02 block,'' a company statement said.

The KG-DWN-98/4 block is located in the Krishna Godavari basin.

On completion of the agreement, subject to Government approval, the consortium on this block will comprise BG India (30 per cent), ONGC (55 per cent), and Oil India Ltd (15 per cent).

The second block, MN-DWN-2002/02 is located in the Mahanadi basin. ONGC will have a 75 per cent participating interest and will remain operator, while BG India will have the rest.

''BG is already an established contributor to the nation's economic success through our upstream and downstream interests on the West Coast.

We have an excellent relationship with ONGC through our existing partnership agreements on the Panna/Mukta and Tapti fields and our other joint interest in the KG Basin,'' said BG India Managing Director Kapil Garg.

''India is a key asset in BG's global portfolio. It is one of the largest and fastest growing energy markets in the world and this agreement allows us to continue our investment and expansion in the country,'' said BG Group Executive Vice President and Managing Director (Africa, West Asia and Asia) Stuart Fysh.

Media reports say BG Group is planning to invest up to 15 billion dollars in future exploration activities in the KG block sitting next to Reliance Industries' KG-DWN-98/3 or KG-D6 gas development.

In addition, the UK company will also compensate ONGC for past exploration costs on commercial discoveries as well as bonuses at a rate of one dollar per barrel for oil and 50 cent per BOE for gas discoveries in the two blocks.

BG's earlier attempts to farm-in to ONGC's three other blocks were turned down by the Petroleum Ministry.